How does Klarna Pay Later work for merchants?

[Shereenchong56]

Dear community,

I wonder if you could tell me how Klarna Pay Later works.

1) Does Klarna paid us merchants in full from the purchase and deal with the customer end for the instalment OR Klarna Pay Later pay to us merchant by instalment as well?

2) What is your experience with Klarna Pay Later, is it worth it?

Thank you and I wish you a good day.

Shereen Chong
Owner of Bajoux store

[Dirk]

Hey, @Shereenchong56 

Great questions! I was able to find this information directly from Klarna's website here.

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You will receive payment according to your payout schedule. Pay later is one of Klarna’s payment options and does not affect how you receive the settlement. Klarna will always pay for the order regardless of how the customer chooses to pay.

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I have not personally used Klarna but I can say I have noticed it as an option on a lot of ecommerce stores as of late. I think Klarna is specifically useful if you sell big-ticket items, where an upfront cost of several hundred (or thousand) dollars may be overwhelming for customers. This would likely result in a higher conversion rate as the entry to your product cost would be softened by installed payments vs a large lump sum.

If there is anything else I can help you with, please let me know.

[KristiAtKlarna]

Klarna pays merchants when the Klarna order is captured based on a settlement / payout delay, more info at: https://www.klarna.com/uk/business/merchant-support/when-will-i-receive-my-payouts/

The merchant's settlement delay depends on the merchant contract based on certain integration factors.  The Klarna order may be captured (full or partial) when the order is shipped or placed, depending on your store's integration method and configuration.